In September, the 2nd District Court of Appeals whose territory covers Collier County explained the distinction between a release and an exculpatory clause.
The case that sparked the ruling involved Ila Abis, who settled with a heartworm medication manufacturer after the death of one of her dogs. The manufacturer paid Abis $2,000 for the replacement cost of the dog, $5,000 for costs relating to training a new dog, and had Abis sign a release. After signing the release, she sued her veterinarians for negligence, and argued that her claims for negligence were not barred because the release did not specifically mention negligence. The Court found that claims for negligence related to the heartworm medicine were barred by the release. It distinguished a release that is executed after a claim arises from a pre-claim exculpatory clause.
By definition, an exculpatory clause is specific language in a contract that protects a party from claims arising in the future. In order to bar claims for negligence, an exculpatory clause must state its intent with particularity. According to the Court, “(The) requirement that exculpatory clauses specifically reference negligence arises from the concern that when parties enter into a contract that has an exculpatory clause, they may not fully appreciate the range of future claims that may arise between the parties.
The uncertainty regarding future events points to a heightened need for specificity. No such policy concern exists for postclaim releases, however, because once an injury has occurred, the parties are aware of the circumstances related to the injury and the injured party can reasonably be held accountable for fully appreciating the implications of a general release.”
In other words, the release that Abis signed barred her negligence claims, even though it did not specifically mention negligence. However, if Abis had signed a similar document before the accident, the document may not have been sufficient to protect the doctors from her claims.
Releases and exculpatory clauses make their way into all kinds of contracts, and they may or may not be enforceable. For example, it is against public policy in Florida to enforce a document that releases a party from intentional bad acts. Parties cannot contract away the responsibilities imposed by statutes, such as Florida’s comprehensive regulations governing building contractors.
Earlier this year, a Florida appellate court issued an opinion that found that a geologist licensed in Florida was not entitled to the protections of a limitation of liability clause in his firm’s contract with a country club. That opinion brought into question the enforceability of any contract that seeks to limit individual liability for negligence of professionals, such as architects, engineers and others practicing under a license issued by the state of Florida.
Lots of contracts contain provisions that attempt to exculpate, release and limit liability, but whether or not those clauses are enforceable will depend entirely on the specific facts of the case.
Marc Huling is a business litigation attorney at the law firm of Roetzel & Andress. He represents clients in a wide variety of business contract and tort disputes. Contact him at (239)649-2716 or MHuling@ralaw.com.